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Special rules for postponed gains |
| | 16. - (1) Sub-paragraph (3) below applies where the whole or any part of any gain which-
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(a) would (but for any provision of this Act) have accrued on the disposal of any asset, or |
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(b) would have accrued on any disposal assumed under any enactment to have been made at any time,
falls by virtue of an enactment mentioned in sub-paragraph (2) below to be treated as accruing on or after 6th April 1998 at a time (whether or not the time of a subsequent disposal) which falls after the time of the actual or assumed disposal mentioned in paragraph (a) or (b) above ("the charged disposal").
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(2) Those enactments are-
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(d) section 154(2) or (4), |
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(e) Schedule 5B or 5C, or |
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(f) paragraph 27 of Schedule 15 to the Finance Act 1996 (qualifying indexed securities). |
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(3) In relation to the gain or part of a gain that is treated as accruing after the time of the charged disposal-
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(a) references in this Schedule (except this sub-paragraph) to the disposal on which the gain or part accrues are references to the charged disposal; and |
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(b) references in this Schedule to the asset disposed of by that disposal are references to the asset that was or would have been disposed of by the charged disposal;
and, accordingly, the end of the period after 5th April 1998 for which that asset had been held at the time of the disposal on which that gain or part accrues shall be deemed to have been the time of the charged disposal.
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(4) In relation to any gain that is treated by virtue of-
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(a) subsection (1) of section 12, or |
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(b) subsection (2) of section 279,
as accruing after the time of the disposal from which it accrues, references in this Schedule to the disposal on which the gain accrues, to the asset disposed of on that disposal and to the time of that disposal shall be construed disregarding that subsection.
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(5) It shall be immaterial for the purposes of this paragraph-
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(a) that the time of the charged disposal or, as the case may be, the time of the actual disposal from which the gain accrues was before 6th April 1998; and |
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(b) that the time at which the charged disposal is treated as accruing is postponed on more than one occasion under an enactment specified in sub-paragraph (2) above. |
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Special rule for property settled by a company |
| | 17. - (1) No part of any chargeable gain accruing to the trustees of a settlement on the disposal of any asset shall be treated as a gain on the disposal of a business asset if-
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(a) the settlor is a company, and |
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(b) that company has an interest in the settlement at the time of the disposal. |
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(2) Subject to the following provisions of this paragraph, a company which is a settlor in relation to any settlement shall be regarded as having an interest in a settlement if-
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(a) any property which may at any time be comprised in the settlement, or any derived property is, or will or may become, payable to or applicable for the benefit of that company or an associated company; or |
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(b) that company or an associated company enjoys a benefit deriving directly or indirectly from any property which is comprised in the settlement or any derived property. |
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(3) This paragraph does not apply unless the settlor or an associated company is within the charge to corporation tax in respect of chargeable gains for the accounting period in which the chargeable gain accrues.
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(4) In this paragraph "derived property", in relation to any property, means income from that property or any other property directly or indirectly representing proceeds of, or of income from, that property or income therefrom.
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(5) For the purposes of this section a company is to be treated as another's associated company at any time if at that time, or at another time within one year previously-
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(a) one of them has had control of the other; or |
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(b) both have been under the control of the same person or persons. |
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(6) In this section "settlor" has the meaning given by section 660G(1) and (2) of the Taxes Act.
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(7) This paragraph has effect subject to paragraph 20 below.
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Special rules for assets acquired in the reconstruction of mutual businesses etc. |
| | 18. - (1) Where-
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(a) shares in a company have been issued under any arrangements for the issue of shares in that company in respect of the interests of the members of a mutual company; and |
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(b) a person to whom shares were issued under those arrangements falls by virtue of subsection (3) of section 136 to be treated as having exchanged interests of his as a member of the mutual company for shares issued under those arrangements,
paragraph 2 above shall have effect (notwithstanding that section) as if the time of that person's acquisition of the shares were the time when they were issued to him.
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(2) Where-
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(a) a registered friendly society has been incorporated under the Friendly Societies Act 1992, and |
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(b) there has been a change under Schedule 4 to that Act as a result of which a member of the registered society, or of a branch of the registered society, has become a member of the incorporated society or of a branch of the incorporated society,
paragraph 2 above shall have effect (notwithstanding anything in section 217B) in relation to the interests and rights in the incorporated society, or the branch of the incorporated society, which that person had immediately after the change, as if the time of their acquisition by him were the time of the change.
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(3) In this paragraph-
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"the incorporated society", in relation to the incorporation of a registered friendly society, means the society after incorporation; |
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"insurance company" has the meaning given by section 96(1) of the Insurance Companies Act 1982; |
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(a) a mutual insurance company; or
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(b) a company of another description carrying on a business on a mutual basis;
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"mutual insurance company" means any insurance company carrying on a business without having a share capital; |
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"the registered society", in relation to the incorporation of a registered friendly society, means the society before incorporation. |
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Special rule for ancillary trust funds |
| | 19. - (1) Use of an asset as part of an ancillary trust fund of a member of Lloyd's-
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(a) shall not be regarded as a use in respect of which the asset is to be treated as a business asset at any time; but |
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(b) shall be disregarded in any determination for the purposes of paragraph 9 above of whether it was being put to a non-qualifying use at the same time as it was being used for purposes mentioned in paragraph 5(2) to (5) above. |
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(2) In this section "ancillary trust fund" has the same meaning as in Chapter III of Part II of the Finance Act 1993.
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General rules for settlements |
| | 20. - (1) Where, in the case of any settlement, the settled property originates from more than one settlor, this Schedule shall have effect as if there were a separate and distinct settlement for the property originating from each settlor, and references in this Schedule to an eligible beneficiary shall be construed accordingly.
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(2) Subsections (1) to (5) of section 79 apply for the purposes of this paragraph as they apply for the purposes of that section.
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General rule for apportionments under this Schedule |
| | 21. Where any apportionment falls to be made for the purposes of this Schedule it shall be made-
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(a) on a just and reasonable basis; and |
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(b) on the assumption that an amount falling to be apportioned by reference to any period arose or accrued at the same rate throughout the period over which it falls to be treated as having arisen or accrued. |
